Faced with likely rejection because of procedural reasons, Entergy Corp. and ITC Holdings Corp. have withdrawn their Texas application to merge transmission systems.
The move came at the end of an hours-long hearing Friday in Austin, Texas, before the state's Public Utility Commission.
New Orleans-based Entergy and Michigan-based ITC are trying to merge by late December. They asked Texas commissioners to reconsider a new application even faster than the 180-day schedule required there.
Administrative law judges had recommended Texas reject the application, saying higher rates would outweigh hard-to-quantify benefits. The two companies offered to waive rate increases for at least five years, a benefit the companies say is worth $90 million to Entergy Texas customers. But that plan came after a procedural deadline, and commissioners said Friday they couldn't consider it, in part because other parties in the case hadn't had a chance to respond, and because the current 180-day deadline arrives next week.
"I just feel like there are too many unanswered questions," said Commission Chairman Donna Nelson.
Commissioner Kenneth Anderson criticized the companies for filing before the details of the deal became clear, leaving the decision-makers too little time. He and Nelson agreed that they would personally hear a new filing to try to speed things up.
"We appreciate the commission's decision to allow us to withdraw our application, with an opportunity to re-file so that all of the commitments that we have already indicated we are prepared to make can be included in the record for the commission to consider," said ITC spokeswoman Louise Beller.
Entergy spokesman Checky Herrington said the companies aren't sure yet how Friday's action will affect the merger's potential completion date.
Announced in December 2011, New Orleans-based Entergy said it would transfer its high-voltage lines to ITC of Novi, Mich. That company would issue Entergy shareholders enough stock to give them a majority of ITC shares worth more than $2 billion, and ITC would also assume $1.78 billion in debt. Entergy and ITC won approval for the plan from the Federal Energy Regulatory Commission in June.